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RADIO 4 CURRENT AFFAIRS ANALYSIS NEW CITIES FOR OLD TRANSCRIPT OF A RECORDED DOCUMENTARY Presenter: Diane Coyle Producer: Zareer Masani Editor: Nicola Meyrick BBC White City 201 Wood Lane London W12 7TS 020 8752 6252 Broadcast Date: 29.04.04 Repeat Date: 02.05.04 CD Number: PLN174/04VT1017 Duration: 27.35 Taking part in order of appearance: Beverley Skeggs Professor of Sociology, Manchester University Tom Bloxham Chairman, Urban Splash Michael Parkinson Director of the European Institute for Urban Affairs at Liverpool John Moore’s University Professor Richard Florida Carnegie Mellon University, Pittsburgh, and author of ‘The Rise of the Creative Class’ Dr. Roger Zogolovitch Architect, LSE Cities Programme Anne Power Professor of Social Policy at London School of Economics Sir Howard Bernstein Chief Executive of Manchester City Council COYLE: The Government is claiming credit for what it calls “a quiet revolution” in cities which once seemed doomed to rusting deindustrialisation, poverty and unemployment. Places like Glasgow, Manchester, and Birmingham are thriving, and others like Liverpool and Leeds hope to catch up soon. But is this a false dawn or a real urban renewal? SKEGGS: I think it works incredibly well at a policy level because it lets policy makers off the hook. It fits into all the new labour policy about culture being the means of changing people and instead of thinking about how people occupy positions within the economy, and that leads to how they can behave. People don’t make a choice to live in a particular area if they’re poor. That’s where they are, that’s where they are placed and that’s where they get fixed. . COYLE:Beverley Skeggs, Professor of Sociology at Manchester University, is sceptical about New Labour’s cultural revolution. A model of the kind of private developer the government wants to encourage is Tom Bloxham, whose company is called Urban Splash.. BLOXHAM I think we’ve only seen the start of things. In the Northern cities we will see more and more people move back in, the city centres will grow and grow, the quality of life will improve, the facilities will improve – more delis, more shops, better schools, better doctors. And, like in virtually every other country in the world, the bigger the city you live in, the closer to the centre of the city you live in, the more aspirational it is.… COYLE: Last week a report released by the Deputy Prime Minister, John Prescott, claimed that this kind of urban renaissance is under way in eight core English cities. Government has moved decisively away from ambitious state planning of urban policy, depending far more on profit- driven private enterprise. But who’s right about the outcome, the sociologist or the builder? Can private developers really bring about an urban renewal that’s sustainable and also benefits people living on low incomes in sink estates? Tom Bloxham. BLOXHAM In the centre of Manchester the wealthiest merchants lived in Georgian times, and what happened is when the factories came in they started belching out smoke and the poor workers started living very close to the factories and the rich people moved further and further out. And what we saw in the 90s was a reversal of that: people beginning to move back into the city centres. Yes and the first people to move in undoubtedly were the vanguard, were the adventurous people. Now it’s much, much, much more mainstream – the people you’ll see are by and large professional classes doing all sorts of different things. COYLE: One aspect of this kind of revival in some British cities is that it’s a very elite thing. Do you think that is a danger – that we’re just kind of moving the problems out to sink estates? BLOXHAM: You know most of the cities, it’s not a question of moving people out. There was nobody living in the city centres to begin with – they were empty, they were derelict, they were desolate. Increasingly now Urban Splash are working on regenerating what I call the doughnut around the city centers - reinventing tower blocks, disused tower blocks as a good place to live. COYLE: Manchester’s city centre population has climbed from a few hundred to nearly 10,000 in the last decade. And Tom Bloxham has won architectural prizes for his conversions of once-derelict warehouses and quaysides. He’s also making plenty of money out of the opportunities he spotted early in the urban recovery. But then property has always been about making a profit. Professor Michael Parkinson is director of the European Institute for Urban Affairs at Liverpool John Moore’s University. PARKINSON Some of the creative developers are actually taking bits of cities which people thought were off but actually were quite on and are quite hot, and that’s one of the tricks. Twenty years ago the cities were essentially a drag on the economy – people were moving out of them, politicians didn’t care, the private sector thought there was no profit. But cities are back in fashion. There’s a new breed of people who want to go into those city centres and that’s created a demand. And so clever suppliers have come in and said: “Oh well they want different sorts of things, they want different kinds of property, they want a different mix of services. We can’t just chuck up low grade stuff any more without services. This is a more demanding clientele. It’s got money to spend.” So you’re seeing, I think, a mix of more interesting demand and some more interesting developers who are willing to supply it.… COYLE:There’s a new demand for city centre living and urban buzz from young professionals, people working in the media and arts for instance. This can mean a welcome architectural facelift, like the eye-catching new Selfridges store in Birmingham for example. Some experts see such changes as part of the transition to a post-industrial, knowledge economy. Creative professionals want to be somewhere exciting, with upmarket shops and all those restaurants and coffee bars. And they want to be some place with lots of other similar people, which means urban success can rapidly snowball. At least, that’s the argument in America, where a leading advocate of this theory is Professor Richard Florida, author of ‘The Rise of the Creative Class’. FLORIDA It includes people who use their intellectual capital and knowledge, their creativity to create economic value – scientists, people who work in high tech fields in research and development, artists, musicians, entertainers, culturally and aesthetically creative people. And then add to that the traditional professions of law, finance and health care. When you add all of those people up, that accounts for – whether it’s the United States or the UK, any of the advanced European nations – about thirty percent of the workforce. But the people in this creative class account for more than fifty percent of all wages and salaries and indeed they’re very, very highly, highly concentrated in urban centres. COYLE: So what is it that’s new about the phenomenon now? FLORIDA: Creativity has always been an economic force. We didn’t recognise it as much when we had older industrial centres perhaps like Pittsburgh or Manchester or Birmingham. We believed that raw materials or natural resources or before that fertile soil, a big port facility, large capital intensive factories were the critical factor. In fact in those days only five or ten percent of people were employed using their creativity. But now creativity becomes the main economic driver of regional success. What we still don’t know is why certain communities tend to get more of this asset than others. Why does human creative capital tend to concentrate in London or San Francisco or Boston instead of Pittsburgh or Detroit? … COYLE: nybody who’s visited decaying Pittsburgh – where Professor Florida is based - would find that an easy question to answer. Cities like these grew because of specific advantages such as access to resources in the industrial age, and now the only thing they ever had going for them has gone. But other cities, especially in Europe, have a very different tradition, open to innovation and diversity. Roger Zogolovitch, a London-based architect and developer.. ZOGOLOVITCH One of the great strengths of London and the British city rather than maybe the American city is that social housing, affordable housing, all layers of activity seems to be quite comfortable taking place cheek by jowl. There’s always been a kind of wonderful local relationship between somebody that is actually occupying a building in a part of the inner city that comes down and actually then buys their fruit, their vegetables from a local market and builds on that local transaction to in a sense the benefit of the local economy of that neighbourhood… COYLE: There’s a rose-tint to this vision, but European cities are more integrated than many American ones. Still, everyone seems to agree now that social mix and local variety are important to the health of the city. But do art and culture really add up to a vibrant economy, no matter how creative they are? FLORIDA Certainly museums and amenities and nightlife and lifestyle and great schools and great hospital facilities and great medicine are all important to that as well as a mix of sunshine and clouds. But really what enables a city to tap this energy is something much more elemental COYLE: Richard Florida FLORIDA Cities have to become open to diversity. They have to become the places where a young person or an old person, a woman or a man, a straight person or a gay person, a Latino or Hispanic person, an Asian person, an African black person can be themselves and reinvent themselves, create and follow their dreams. COYLE: I think many people would be rather sceptical about whether say having a lot of gay bars or art galleries and encouraging openness would stimulate economic growth? FLORIDA: Well there is a self-evident correlation that’s statistically been replicated in the United States, in Canada, in Australia, which shows that cities with relatively higher concentrations of so-called bohemians and cities with relatively high concentrations of gay people or relatively high concentrations of new immigrants economically do better than other cities. They are more innovative, they have higher rates of patenting, they have higher rates of high technology growth, they have higher value and higher salary jobs. COYLE: But the correlation could be that the urban success and growth is bringing in different kinds of people and bringing in bohemians and gentrification in its wake? FLORIDA: Some critics call it the chicken and egg dilemma. But I’m sure you and everybody out there listening knows about the Soho neighbourhood in New York City or the great inner city environments of San Francisco. What we find actually that happens in those places is that the artists, the bohemians, the culturally creative people and gay people get there first; and then what happens is once those neighbourhoods become exciting and vibrant, then technology people and Wall Street people and financial people begin to come in. Before San Francisco got any high tech industries, the silicone valley area, that place was a centre of arts, it was a centre of culture. If a city can give rise to a psychedelic 60s, a gay movement, an African American movement and all of those groups can feel empowered and validated, it’s also the kind of place that can give rise to high tech entrepreneurship and innovation where entrepreneurs feel that they can come and realise their dreams … . COYLE: But the idea that where the bohemians lead the financiers follow doesn’t convince everybody. Manchester comes top of the British list on Richard Florida’s creativity index, but it was also a thriving industrial center a century ago, when its magnificent neo-Gothic Town-Hall was built by prosperous civic leaders who were anything but Bohemian. And what about towns like Bradford and Oldham, which depended almost entirely on manufacturing industry and show no signs of attracting either the new Bohemians or the high-tech financiers? POWER : What I want in the city is lots of problem solvers - people who have professional skills, who have a high level of education and who have a high level of commitment to solving urban problems. COYLE: Anne Power, Professor of Social Policy at the London School of Economics, sees Richard Florida’s creative class as no more than the froth on the cappuccino. POWER In the big bursts of city recovery, city strengthening of the past, whether it was in Ancient Greece or Ancient Rome or in the Victorian era in this country, it was because problem solvers, people with high motivation and high skill were locked into the same problems as very low income people who really had just about enough capacity to survive. And sharing the same problems, those problem solvers actually dedicated themselves to creating the town halls, to cleaning the streets, to creating lighting, to setting up a police force, to basically tackling urban problems. When people talk about the creative class and they talk about gay bars and cultural centres and art galleries and the media, of course those are part of city life and of course they’re very important, but they’re actually a reflection of the needs of problem solvers who are busy solving problems during the day and then want to have fun in the evening. And that’s fine, they’re not the actual lifeblood of the city. COYLE: Whether it’s the hard-headed professionals or the artists and entertainers who come first, there’s no doubt that active campaigns to bring them together have helped cities like Glasgow and Birmingham turn the corner. Liverpool has been less successful, but it was recently chosen as European Capital of Culture for 2008, and it’s expecting an extra £2bn in investment and 14,000 new jobs. Professor Michael Parkinson is the author of a report for the government earlier this year which shows that his home town, like other British cities, needs to tackle some basic structural weaknesses. PARKINSON My judgement is the thing that really drives cities and economies is innovation. I think lots of European countries have got better innovation policies than we’ve had in this country. A second thing which is terribly important is connectivity both inside and outside countries – the whole virtual and real connection between airports, TGV, information technology. We lag behind there. Modern industries depend upon skilled workforces. Our workforces in our cities are far less trained than the workforces of the more successful European cities. Governments in Europe have trusted cities more than government in this country has. Governments in Europe have given cities more powers, more resources than our government has. And I think it’s probably true to say those cities have responded to the challenge and have become “the entrepreneurial creative cities which are driving regional and national economies.” That’s what we have to do. COYLE: Do you think the British actually like cities very much, or do we prefer culturally in some sense the countryside or even the quiet suburbs? PARKINSON: I think that’s probably changing. Historically the English made their money in cities and cleared off as quickly as they could to their country residences, and I think that still underpins a fair amount of kind of suburbanisation. That’s very different, I think, from the Europeans where the posh lived in the city centre and enjoyed it and therefore set standards and created demands for higher quality environments.… COYLE: Many of the current generation of developers are determined to turn Britain’s cities into centres of innovation as exciting as any on the Continent. Architect Roger Zogolovitch is part of the Cities Programme at the London School of Economics and sees a need for what he calls “densification” rather than conservation, even in an area as built up as central London. ZOGOLOVITCH We can work on something that was known as interstitial sites, those kind of leftover bits of city which other people have forgotten and thought are rubbish. And what I mean by that is bits of land that are next door to railways or bits of land that are jammed between the edge of a council estate and a street that was maybe demolished in the 60s and we can tease into those sites something which we put a lot of effort and energy into making very creative and the effort in a way to try and build beauty into these little unloved spots. The city is more beautiful for the contrast of the elements within it. I don’t share, I’m afraid, Prince Charles’ view in terms of looking at a kind of matching set of contexts. If you describe a street almost like a bookshelf – that a bookshelf still looks very good even if the spines in each of the book are a different colour or a different shape.… BLOXHAM Yeah, I mean absolutely – you know half the problem of our cities were they were too planned: there was a residential area, a commercial area, a retail area and that killed the cities. You know we have a consensus now that the mix of uses is the right way forward, yet we have a planning system still based on separating the uses.… COYLE: Tom Bloxham of Urban Splash in Manchester. BLOXHAM There’s nothing more joyful than going into a city down a little alleyway and finding a lovely little cobbler shop or hairdresser’s or indoor market or something else of surprise. It makes cities different from each other. I hate Anytown UK where every shop has got the same plastic fascia and the same shopping there and what we’re looking for is individuality, difference, independent retailers, some heart and soul back into our cities. COYLE: And do you think we need more deregulation to get there and leave it to people like you? BLOXHAM: I’m not sure we need deregulation, but I think we need a benign planning system, I think we need to encourage entrepreneurs, I think we want to encourage people with all sorts of ideas even if they might be a bit wild and wacky… COYLE: For this kind of benign planning regime, Tom Bloxham looks to a new sort of Town-Hall leadership – from people like Sir Howard Bernstein, Chief Executive of Manchester City Council. How does he feel about encouraging the wild and the wacky? BERNSTEIN There are two different forces at play in the South East and outside the South East. Within the South East, there are real and significant developmental pressures which have to be managed. Outside the South East, I spend most of my time positively encouraging development to take place, particularly on brown field sites in the major urban centres like Manchester which are difficult to develop. … COYLE: So one size doesn’t fit all when it comes to planning laws. We may well need more building controls in the overheated and overcrowded south-east, while offering more incentives and subsidies to developers up north. Sir Howard’s approach has certainly been visibly successful in downtown Manchester with its luxurious loft apartments and a famously thriving Gay village in and around Canal Street. But has the success come at a price? Professor Beverley Skeggs, who actually lives in one of Tom Bloxham’s new Manchester conversions. SKEGGS It does look like a success story on the surface, but a success story for an incredible small minority in the sense that most British cities are surviving by becoming leisure centres and so this has had a huge detrimental effect on all the surrounding satellite towns in terms of attracting local people. Newcastle’s a very interesting place to watch at the moment because it is in an area of incredible economic deprivation but the city centre itself is regenerating through culture again. But you get exactly the same problem. The city centre looks spectacular – I mean much more spectacular than Manchester does – but everybody who cannot participate in that culture is excluded to the margins and the margins are looking even more horrific than they were before. So what is seen to be a success story seems to always depend on excluding people, which is completely you know supposedly against the government’s whole agenda of social inclusion. In fact the model that they’re following is social exclusion on a huge scale I’d argue as well. … COYLE: It might sound paradoxical that downtown Manchester and Newcastle are both draining talent from surrounding towns and excluding the less fortunate. But Beverley Skeggs is not alone in her concern that the metropolis thrives by driving poverty out to an exploited periphery. Even Professor Richard Florida, the champion of the new creative class, is worried. FLORIDA Countries that are becoming split in two between creative elite and an increasingly disenfranchised service class just won’t work. Left to its own devices, this creative age will increasingly concentrate in and around big metropolitan areas which have many options, excitement, vibrant labour markets, vibrant mating markets where people can meet and mix – you know the Bridget Jones economy “The Economist” called it. They’re going to have enormous benefits and surrounded by these sprawling, horrid you know suburban complexes. But just the way we intervened at the dawn of the industrial age to try to create somewhat better cities. Imagine if we had left the industrial age with the squalor it was producing and the uneven development patterns and lack of land use planning. Without an effective hand, institutional hand, creative public policy guiding us, the creative economy will lead to urbanisation nightmares. … COYLE: So newly enriched Manchester could cast a blight over its satellite towns. But does there have to be a contest between the big regional centres and smaller provincial towns? Couldn’t the economic benefits in fact ripple outwards, creating more jobs for everyone? Howard Bernstein. BERNSTEIN Somebody said to me “You know you’re promoting this new resort casino in East Manchester, well that’s going to be very, very exclusive.” And I said “Well no, there’s three thousand jobs involved in that.” Two of the richest people in America, one an elderly gentleman, flew over from Las Vegas because he wanted to demonstrate to me and my colleagues his commitment to invest over a hundred million pounds in East Manchester. If anyone would have said that to me three, four years ago, I would have pinched myself, but that is the scale of change which we’re trying to drive forward in this city now. COYLE: And do you think it’s sustainable this time? We’ve had urban renewals before and the next time the recession came along it all got set back again. BERNSTEIN: It is sustainable for the basic reason it’s commercially intelligent. This is not a public sector led regeneration programme; this is a community led public sector facilitated regeneration programme. I cannot force the Prudential Assurance Company to invest three hundred million pounds in the Arndale Centre. They’ve got to make their own commercial case to want to do that. They have done.… COYLE: Manchester isn’t alone in its commercially intelligent approach to new investment and the jobs it creates. Sheffield, with its new high tech business park and 400 million pound shopping centre, has seen unemployment fall by more than 50 per cent in the past 6 years. But could the very scale of such success undermine the social mix and diversity that everyone wants, if soaring property prices drive out people who work in the city but can’t afford to live there? Anne Power at the LSE warns that the affluent new Bohemians could be creating a new social chasm in the very heart of cities themselves. POWER Now that we’re getting very rich people getting back into city centres, the polarisation is very visible. The crucial thing is to get back the middle range of people who at the moment can’t afford city centre lofts and don’t want to live in poor inner city declining neighbourhoods. And what you need to do is spend half the money it would cost to build the new housing in regenerating and renovating and strengthening some of the very, very good but very decayed housing stock that we’ve got in our inner cities. If you look at those streets objectively, as I do, a lot of the time you see huge intrinsic value in them. They’ve often got mature trees, they’re usually designed in a very attractive way, they’re at moderate density, they’re the kind of streets which have corner shops and have pubs and have churches and have bus routes and have small back gardens. They are very close to the city centre, they’re manageable and they’re not very expensive to put back to something very splendid. When the London boroughs like Islington were being put back from slum clearance into something very expensive, the government was offering incentives of twenty-five thousand pounds per home to do it and my home was a beneficiary. If you try and do that in Manchester today, you don’t get anything. So we haven’t got an urban regeneration programme that actually favours putting back the inner neighbourhoods which in turn would attract the middle band of people, that would then reduce the polarisation of cities. … SKEGGS I’m not sure whether that works. I’d actually argue that you need to get those who’ve been really, really put outside of the city back into the city.… COYLE: Sociologist Beverley Skeggs balks at the thought of subsidising the middle-classes to return from their comfortable suburban exile. SKEGGS You have areas in North Manchester, you have areas in South Manchester where people feel that they cannot now use the city centre because it’s first of all too expensive, they’re made to feel incredibly uncomfortable in it, they’re often criminalized and policed out of it. Again it depends on whose perspective. If you want to have a story of integrated, inclusive success where you don’t have social problems of a major kind, you bring the working class back into the city centre. If you want to have a story which is a bit like the creative class idea, which is that urban regeneration is primarily culturally led, you bring the middle class back in.… COYLE: But it’s hard to see why the creative city and the working city should have to be mutually exclusive - as long as we can make urban living affordable for both middle class professionals and the lower-paid workers who service their needs. The days of massive council house programmes are long gone, and there’s no serious prospect they’ll return. The approach the government now prefers aims at getting private developers to provide a minimum quota of low-priced housing. The Treasury’s also looking at taxing the windfall profits they make from buying and selling land. Not surprisingly, developers like Roger Zogolovitch plead that they need decent profit margins in return for taking big risks. ZOGOLOVITCH People misunderstand it. They look at those margins and think this is suddenly going to be a huge kind of gravy train in some sense. It is just a margin of risk. There are huge amounts of risks in undertaking a development. There’s a risk on construction, there’s a risk on the market position, there’s a risk on planning. And the difficulty I think that perhaps is not known in the kind of public’s mind is the time that it takes to bring about regeneration in the city and most of the projects we work on are really in the range of three to five and upwards, to seven years. Actually if you think about that in an economy which is fast moving, I think you’re having to predict where that economy might be, where the demand might be way after the date when you’re actually making those investment decisions.… BLOXHAM I think by putting quotas on developers to give fifty percent affordable housing, it’s counter-productive.… COYLE: Tom Bloxham. BLOXHAM If you have a developer who wants to sell a house for a hundred thousand, if you tell him fifty percent of them have got to be sold for fifty thousand, the other fifty percent obviously go up to a hundred and fifty thousand, and ironically it’s fuelling house price inflation. COYLE: But I think it does seem natural to many people that … to the extent that property developers are getting some help from the government in the form of grants for urban regeneration, that they should somehow be giving some of it back to the community. BLOXHAM: You know it is too simplistic just to say give something back because you can’t give something back without getting it from somewhere. People have got to be a bit more sophisticated than they have been to date on this, and there is a real problem of affordable housing and there are ways to solve it. In the North of England there are swathes and swathes and swathes of affordable housing nobody wants to live in, an abandonment, and they need imaginative ways to actually revitalize these areas and bring people back to live in them. … COYLE: He’s currently selling luxury apartments in central Manchester for around half a million pounds – enough to buy a decent-sized family house in my London neighbourhood, or a dozen houses in some parts of Greater Manchester. But Urban Splash does also build lower cost housing in the city. And in theory, market forces mean that a big enough increase in housing supply to meet the demand should bring down prices for everyone. In practice, many people are uncomfortable with some of the social effects of the market mechanism. It’s hard to see the private sector alone tackling Britain’s long-standing north-south divide; or reclaiming the waste lands Tom Bloxham described. Richard Florida believes that the key to really inclusive and sustainable urban renewal lies in enlightened political leadership. FLORIDA The creative economy left to its own devices is an incredibly unequal economy. It is far more unequal than the industrial economy. A hundred years ago when the industrial economy emerged, it created great wealth and great productive potential, but all of that money went to the robber barons and their immediate managerial elite. But what we did over the course of the 1930s and 1940s is we oiled that industrial engine with Labour parties and social democratic parties and Franklin Delano Roosevelt here. We said that workers too could participate in that and gain income and have better jobs and see their working conditions improve and their work days shorten. We need the same kind of thing with the creative economy. Look at London, look at San Francisco. There is a creative elite alongside an increasingly impoverished population of people toiling to conduct service work. Left to its own devices and market mechanisms, the creative economy will not solve this problem. That’s why we need political leadership. But, you know what, we don’t have it.… COYLE: So the onus is on effective and imaginative government to give a stake in the creative economy to the very many less-skilled people we need for our cities to function. There’s a real buzz in some British cities now, thanks in part to town halls which have switched from the failed top-down planning of the past to a more flexible and imaginative coordinating role. But that success won’t be sustained if it doesn’t spread beyond the creative elite flocking to spend their money in a handful of expensive city centres.. The Oldhams and Walsalls are still waiting for their urban renaissance. 1